by Shristi Achar A and Noel Randewich
(Reuters) – The New York Stock Exchange ended sharply higher on Tuesday, led by Tesla, Nvidia and other high-growth stocks, after U.S. jobs data fueled speculation of a pause by the Federal Reserve (Fed) in its interest rate hike campaign.
The Dow Jones index gained 0.85% to 34,852.67 points.
The broader S&P-500 gained 1.45% to 4,497.63 points.
The Nasdaq Composite advanced for its part by 1.74% to 13,943.76 points.
S&P-500 and Nasdaq ended at more than two-week highs, following the release of a report indicating that the number of job openings in the United States fell in July, for a third consecutive month , signaling an easing of pressures on the labor market.
Investors also took note of the Conference Board’s monthly survey showing that US consumer confidence unexpectedly deteriorated in August.
The Fed is expected to decide at its monetary policy meeting in September to pause its cycle of rate hikes. Moreover, the assumption that it will maintain them at their current levels until November is gaining credibility in the eyes of some.
“Investors are thinking, maybe interest rate hikes are behind us, so let’s buy stocks,” commented Sam Stovall, chief strategist at CFRA Research.
The yield on ten-year US Treasury bonds fell to 4.11%, while those over two years fell back below the 5% threshold around which they had been established for several sessions.
This drop in bond yields fueled gains in high-growth stocks, including Nvidia, which rose 4.2% to its all-time high.
Tesla jumped 7.7%, despite documents showing that a U.S. regulator asked the electric vehicle maker for details about system changes to its self-driving software.
All major S&P-500 sectors advanced, led by communication services up 2.46%.
Investors await the publication of the personal consumption expenditure price index, data favored by the Fed to assess inflation, and data on non-farm payrolls at the end of the week. Wall Street had already finished higher on Monday, driven by unsurprising comments from Fed boss Jerome Powell on Friday at the Jackson Hole central bankers’ meeting.
( Jean Terzian)
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